Portland seeks manufacturing boost from local foods

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PORTLAND, Maine — In the competition to gain designation as one of 12 federal manufacturing centers, most successful communities sought to boost heavy industries such as aerospace, automobiles, or technology equipment.

Greater Portland won with fermented beverages, doughnuts, and seafood.

Famous for lobster, fresh fish, and an abundance of restaurants, the Portland area is hoping to use the designation — and the economic development grants that are expected to follow — to revive a food-processing industry fallen on hard times, expanding it to take advantage of a passionate local-food movement.

The idea is to connect the region, the center of food processing in the state, to Maine’s farms, restaurants, and homegrown products such as potatoes, cheese, and blueberries.

In a state where manufacturing employment has fallen by more than half since 1979, and the rate of rural poverty is among the highest in the United States, there is hope that the federal manufacturing designation could help increase the number of city jobs as well as boost rural economies by replacing imported products with those grown, raised, or made in Maine.

Economic development specialists in Portland envision scaling up kitchen enterprises into food manufacturing operations, processing more lobsters in-state instead of shipping them to Canada, and increasing exports of Maine goods by 25 percent.

“The food-processing industry in Portland has the potential to influence a much larger geographic area, including the rural parts that are the most struggling,” said Charlie Colgan, a public policy professor at the University of Southern Maine. “One of the key statistics in Maine today is well over half the jobs that have been created since the recovery [from the 2007 recession] have been located in Greater Portland. There are large parts of Maine that have seen almost no recovery.”

One-third of Maine’s food manufacturing occurs in Greater Portland, but in the past decade the number of jobs in the sector has fallen 15 percent, from about 2,100 to 1,800.

One of Portland’s oldest food processors, Jordan’s Meats, shut its doors in 2004, throwing 275 people out of work. Three years ago, Barber Foods, one of the region’s largest employers, was purchased by an out-of- state company, and 250 jobs were cut.

Local political, business, and community leaders viewed the federal program as a way to reverse that trend and build on Portland’s reputation for top restaurants and fresh food. In 2009, Bon Appetit magazine named Portland “America’s Foodiest Small Town.”

The US Commerce Department chose Portland and 11 other communities from about 70 applicants. Portland was the only city in New England to win designation as a federal manufacturing center.

Caroline Paras, a community planner, and the Greater Portland Council of Governments, a regional economic development agency, said that the designation puts Greater Portland at the front of the line for federal grants, with the potential to create thousands of jobs. She said she sees possibilities everywhere.

Portland’s Holy Donut bakery is one example. The three-year-old business makes puffy doughnuts from one of the state’s key crops, potatoes, creating jobs in Portland and a market for growers.

Leigh Kellis started the bakery with borrowed money from her mother after she was turned down by bankers who said her idea wouldn’t work.

Today, Holy Donut employs 25 people at two locations, producing 18,000 potato doughnuts a week. The doughnuts, featuring flavors like chocolate sea salt, sell for $2 each and bring in customers willing to wait in long lines most mornings. Kellis said she is considering expanding, possibly across the state. “This business is an infant,” she said, “and you spend all your waking hours thinking about it.”

Portland Mayor Michael Brennan said he is not a “foodie,” but the region needs to do whatever it can to improve its economy. Fifty-five percent of Portland’s school-age population qualifies for the free and reduced-cost federal lunch program, he said.

Brennan said a recent move by an Icelandic ocean freight company, Eimskip, to make Portland its North American headquarters is a boon for the city, adding jobs and export opportunities. Eimskip plans to ship refrigerated seafood from Europe to Portland; it will then be sent around the country by rail. Part of Portland’s plan is to fill the empty cargo containers with Maine products destined for Northern Europe’s ports.

“This gives us a very international reach we’ve never had before,” Brennan said. “The more access we have to international markets, the better it is for the local economy.”

International markets could help the entrepreneurs who have started a Portland business called the Urban Farm Fermentory, which makes kombucha (an effervescent fermented tea drink), sauerkraut, kimchi, and hard apple cider with mostly Maine ingredients. Or help Cozy Acres Greenhouses at Clearview Farm, just outside Portland, expand geothermal and sun-powered greenhouses that operate emissions-free year-round.

Sam Hayward, chef-partner at Portland’s well-known Fore Street restaurant, and the James Beard Foundation winner of top chef in the Northeast in 2002, said he sees opportunities to expand Maine’s food industry in ways that benefit not just Portland, but the state.

For example, grants could help launch a state-of-the-art slaughterhouse to offer precise and standardized cuts of local meats. There’s no such facility in the state now. There is also a need for a facility for crops like raspberries that need to be processed and packaged fast.

“Maine could be the breadbasket of New England,” he said. “By rights, it should be.”